HOLIDAY MONEY
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Down to the wire for holiday shopping
Shoppers rush to pick up extra bargains; retailers could benefit from one extra day this Saturday.
December 23, 2005: 11:07 AM EST
By Parija Bhatnagar, CNNMoney.com staff writer
Last-minute bargain hunters could give a good boost to holiday sales.
Last-minute bargain hunters could give a good boost to holiday sales.

NEW YORK (CNNMoney.com) - Retailers expect to see a flurry of sales in the last two days before Christmas, especially as many more shoppers this year say they will be buying their gifts later than ever.

According to market research firm NPD Group, only 44 percent of shoppers had completed their holiday purchases by the end of last week.

"This number is a five-year low," said Marshal Cohen, NPD's chief retail analyst. It's not unusual for shoppers to hold out until the last minute to pick up the best bargains, "and every year the consumer is becoming even more savvy in playing the game of chicken."

But this year in particular, Cohen said shoppers also appear to be distracted.

"When I asked people why they've not finished or even started their shopping yet, a lot of them said they were distracted by the weather or that they couldn't figure out what to buy since there aren't any hot items," he said.

Retailers love procrastinators because a surge in traffic at the end means less pressure to offer deep-discount "panic sales."

And if merchants are feeling confident about their inventory, as they apparently are now, they're also inclined to limit discounts in a bid to preserve profits.

Said Cohen, "Up until yesterday, I didn't see sales that were any bigger. Apart from department stores and some specialty apparel stores, most retailers haven't gone deeper."

Crunch time

Arlington, Va.-based mall operator Mills Corp. (Research), which operates 39 malls around the country, is gearing up for a frenzied rush of shoppers over the next two days.

"The Saturday before Christmas should be big because it gives people that extra half a weekend to shop before both Christmas and Hanukah," said Becky Sullivan, spokeswoman for the mall.

According to the International Council of Shopping Centers (ICSC), the Saturday before Christmas is typically the busiest shopping day of the year.

"The Friday afternoon rush will begin around 2 p.m. A lot of people get out early, others have taken a half-day to go shopping," Cohen said. "Tomorrow will be wild. For those who are not traveling , it'll be all about shopping."

Jeff Odom, spokesman for the Hamilton Place Mall in Chattanooga, Tenn., said he expects it to be a "huge day and heavy traffic" today and tomorrow.

"We are expecting these last two days of shopping to be incredibly busy," he said. "Stores are projecting record days here at Hamilton Place with many anticipating a lot of last minute shoppers still left with items on their list."

Additionally, Odom estimates the mall this Friday will sell over $100,000 in mall-branded gift cards.

Overall, the retail industry has projected a 6 percent sales gain for the season to $439.5 billion, softer than last year's 6.7 percent increase.

Even so, the good news for retailers is that industry watchers are optimistic that holiday sales will meet their forecasts. Cohen expects holiday sales to grow 3.2 to 3.5 percent over last year. "It will get awfully close," he said.

Britt Beemer, CEO of America's Research Group, raised his holiday forecast to a 3.3 percent increase in sales over last year versus his earlier forecast for a 3 percent gain, citing the "catch-up" factor.

"I have never seen a Christmas with so many Americans 'sleepwalking through the shopping season' hoping they can get it all done by (this) Saturday," Beemer said.

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Click here for CNNMoney.com's Holiday Money special report.  Top of page

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